Agenda item

Report of the Director of Finance

The Committee received a report from the Director of Finance providing an update on the Staffordshire Pension Fund Audit 2020/2021 to 2022/2023.

The Committee was reminded that at its meeting in December 2021, a draft Audit Results Report (ISA260) had been received from Ernst and Young (EY) in relation to the audit of the 2020/21 accounts of the Fund. However, it had not been possible to issue a final ISA260 and conclude the audit because of the delayed conclusion of the audit of the County Council Statement of Accounts in which the Pension Fund accounts were included.

The Committee was informed that at the meeting of the Audit and Standards Committee held in December 2023, the Audit Results Report for both the County Council and the Pension Fund accounts had been received which finally concluded the audit for 2020/21. This would allow the draft 2020/21 Annual Report and Accounts for the Staffordshire Pension Fund to be finalised and published on the Fund’s website. The ISA260 for the Pension Fund was included for information at Appendix 1 to the report.

Although the audit of the Staffordshire Pension Fund’s 2022/23 accounts had commenced in June 2023, and was substantially complete, a detailed Audit Plan had not been provided by EY prior to the start of the audit process. This document had now been received and, having been approved at the meeting of the Audit and Standards Committee in December 2023, was attached at Appendix 2 to the report for the Pension Committee’s information. It was noted that once EY completed its external audit of the 2022/23 accounts and the County Council’s Statement of Accounts were finalised, the Pension Fund would receive its concluding ISA260. It was highlighted that a draft copy of the 2022/23 Pension Fund Annual Report and Accounts were published on the Pension Fund website in line with the 1 December deadline.

The Committee was also informed that KPMG had been appointed as the new auditor of the Council’s, and consequently the Fund’s accounts for 2023/24. Reassuringly they had already engaged with Fund officers in advance of the audit process of the 2023/24 accounts beginning.

Liz Staples commented that the national issue of auditors not completing audits of Pension Fund accounts in a timely fashion, had been raised by DLUHC representatives at a recent Pensions Fundamentals training session. It had also been suggested that DLUHC were advocating the separation of Pension and Council accounts to expedite the audit approval process. The Assistant Director of Treasury and Pensions confirmed her awareness of this but highlighted that the County Council’s auditors had been appointed for a five-year period through a Public Sector framework, and as such KPMG had been appointed to take over from EY until the end of the next contract period. It was understood that consideration was to be given to separating the accounts of the Pension Fund from the Council and as a result the audit and approval of such but there was a large amount of Regulation that had to be considered before it was possible to do this.

In response to a request asking when the Borough and District Councils would receive the final assurance statements for the 2022/23 accounts, it was confirmed that this would be as soon as the County Council’s accounts, and subsequently the Pension Fund’s accounts, were finalised.

Notwithstanding the delay to the audit of the Pension Fund’s accounts, the Chair of the Committee congratulated the Treasury and Pensions team on an excellent audit report.

Resolved: a. That the conclusion of the audit of the Staffordshire Pension Fund accounts for 2020/21 and the content of the Final Audit Results Report (ISA260) from EY at Appendix 1, be noted.

b. That the content of the Audit Plan from EY in relation to their audit of the Staffordshire Pension Fund accounts for 2022/23 at Appendix 2, be noted.

c. That the continuing delay in the conclusion of the 2021/22 and 2022/23 external audits of the Staffordshire Pension Fund accounts by EY, be noted.